The Influence of Taxpayers Conciousness, Tax Sevices and Taxpayers Compliance on Tax Revenue Performance (Survey on The Individual Taxpayer in South Tangerang)

THE INFLUENCE OF TAXPAYERS CONSCIOUSNESS, TAX SERVICES AND TAXPAYERS COMPLIANCE ON TAX REVENUE

PERFORMANCE

(Survey on The Individual Taxpayer in South Tangerang)

Created By:

Septian Maulana Yusuf

(109082100006)

ACCOUNTING MAJOR

INTERNATIONAL CLASS PROGRAM FACULTY OF ECONOMICS AND BUSINESS

SYARIF HIDAYATULLAH STATE ISLAMIC UNIVERSITY JAKARTA 2013

CURRICULUM VITAE

_EDUCATION

WORKING EXPERIENCE & INTERNSHIP

ORGANIZATION EXPERIENCE

TRAINING & SEMINAR LANGUAGE & SKILLS

LANGUAGE English Good

PERSONAL DATA Name : Septian Maulana Yusuf Place, date of birth : Jakarta, September 23rd 1991

Permanent Address : Pamulang Permai 1 Blok A.14 No.4 RT.02 RW.010 Pamulang, Tangerang Selatan Nationality : Indonesia Phone : +6281284518282 Email : Septian_maulana27@yahoo.com Septianmy27@gmail.com Hobbies & Interests : Sports, and learning new things

GPA : 3.01

2009 - Now

Syarif Hidayatullah Islamic University

2006 - 2009

KRIDA NUSANTARA Senior High School

2003 - 2006

Pamulang 1 Junior High School 1997

- 2003

Pamulang Elementary school

2012 UKM Batik “Putra Gobah” Klewer – Solo

2010 - 2013

Basket Colledge Sport Federation (FORSA)

2011 Comitte of Futsal Competition (FUSHION)

2013 - ASIAN Tax Community - International Tax Seminar 2012

- Financial Accounting Training - DAAD Seminar on Climate

Change Economy 2010 Insurance Day

2009

- Moderate Muslim Society ”islam in the west and the east: boosting democracy, Human Rights, Freedom and peaceful coexistence”

ABSTRACT

THE INFLUENCE OF TAXPAYERS CONSCIOUSNESS, TAX SERVICES AND TAXPAYERS COMPLIENCE ON TAX REVENUE PERFORMANCE

(Survey on The Individual Taxpayer in South Tangerang)

The purpose of this research is to know the influence of taxpayers consciousness, tax services and taxpayers compliance, as independent variables on the tax revenue performance, as the dependent variable. The data used in this variable is the primary data by using the method of spreading the questioner using convinience sampling method. The sample consists of individuals taxpayers in the South Tangerang. Total questioner that spread is 50. The analysis used multiple regression analysis. Level of significance for t-test of the research is 0.030 for taxpayers consciousness, 0.030 to tax services, and 0.039 for taxpayer compliance and the level of significance for the f-test is 0.000. This shows that taxpayers consciousness, tax services and taxpayers compliance have significant influence on the tax revenue performance.

Key words:

Taxpayers Consciousness, Tax Services, Taxpayers Compliance, Tax Revenue performance

ABSTRAK

Pengaruh Kesdaran Wajib Pajak, Pelayanan Perpajakan, dan Kepatuhan Wajib Pajak terhadap Kinerja Penerimaan Pajak

(Survey Terhadap Wajib Pajak Individu di Tangerang Selatan)

Tujuan dari peneletian ini adalah untuk mengetahui pengaruh kesadaran wajib pajak, pelayanan perpajakan, dan kepatuhan wajib pajak, sebagai variabel bebas terhadap kinerja penerimaan pajak, sebagai variabel terikat. Data yang digunakan dalam variabel ini adalah data primer dengan cara menyebarkan questioner menggunakan metode convenience samping. Sampel terdiri dari wajib pajak individu yang berada di wilayah Tangerang Selatan. Jumlah questioner yang disebar adalah 50. Data diuji dengan analisa regresi linear berganda. Level signifikansi untuk t-test dari penelitian ini adalah 0.030 untuk kesadaran wajib pajak, 0.030 untuk pelayanan perpajakan, dan 0.039 untuk kepatuhan wajib pajak dan level signifikansi untuk f-test adalah 0.000. Ini menunjukan bahwa kesadara wajib pajak, pelayanan perpajakan, dan kepatuhan wajib pajak memiliki pengaruh signifikan terhadap kinerja penerimaan pajak.

Kata kunci:

Kepatuhan wajib pajak, pelayanan perpajakan, kepatuhan wajib pajak, kinerja penerimaan pajak.

PREFACE

Assalamu’alaikum Wr.Wb

All praise to Allah SWT and Shalawat always gives to our Prophet Muhammad SAW

Now with the strength, intelligence, patience, and passion from Allah SWT, author able to finish this thesis as one of requirements to achieve bachelor degree. Author believes there is an invisible hand (God) which have helped me going through this proces.

Author believes that this thesis cound not be finish properly without support and guidance from various parties either direct or indirect. Especially my Father, Mother, and my Sister.

Auhor believes author is nothing without each one of you who has helped me to finish this thesis. Thus, in this very special moment, let author say thanks to all of them who were helped author through the process of this thesis, including:

1. Prof. Dr. Abdul Hamid, MS as a Dean and my supervisor I who have give a time to provide guidance, direction, and motivation to author so that author can finish this thesis.

2. Wilda Farah, M. Si as my supervisor II who have give a time to provide guidance, direction, and motivation to author so that author can finish this thesis.

3. Mrs. Yulianti as Vice Dean II and my lecture who give author education and help in finishing this thesis.

4. Mrs. Rahmawati as taxation lecturer who give a lesson about tax and for help author in finishing this thesis..

5. M. Arief Mufraeni, Lc.,Msi as Head of International Program.

6. Ahmad Dumyathi Bashori, MA as Secretary of International Program. 7. Mr. Sugi Waluyo who give author all information about academic.

8. All lecturer who have taught author patiently and provide uncountable knowledge, and also academic staff for giving good services.

9. All my friends in Accounting International Program 6th Batch (2009), who helped author in finishing this thesis. Bunch of love for diah, evi, arini, opi, aulia, dea, kokoh, angga, ucup, bimo, nanda, putri, pipit, nenek, tami, cici, gamal, adnan, and osman to every support and motivation that you gave to finish my thesis, and also for every joy and sorrow that we have been through together.

10.Thanks to wayan, cimol, brian, fiki, eko, yayan, dhio, fauzi, septya, danang, and all my friends in accounting B and regular class for helping author to finish this thesis, and for everything that we spend together. Author realizes that this thesis is still far from perfection. Suggestion and constructive critism from all parties are expected to improve further. With

LIST OF CONTENTS

CURRICULUM VITAE ... i

ABSTRACT ... ii

ABSTRAK ... iii

PREFACE ... iv

LIST OF CONTECTS ... vii

LIST OF TABLES ... x

LIST OF FIGURES ... xii

LIST OF APPENDIX ... xiii

CHAPTER I : INTRODUCTION A. Background ... 1

B. Problem Formulation ... 6

C. Research Objectives and Benefits ... 6

CHAPTER II : LITERATURE REVIEW A. Basic Concept of Taxation ... 8

1. Definition of Tax ... 8

2. Type of Tax ... 9

4. Tax Rates ... 12

5. Taxpayers ... 12

6. Theory Witholding Tax ... 13

7. Tax Payable ... 15

8. Emergence of Tax Payable ... 15

9. Withholding Tax Principle ... 16

10.Withholding Tax System ... 17

B. Taxpayers Consciousness ... 18

C. Tax Services ... 20

D. Taxpayers Compliance ... 22

1. Type of Taxpayers Compliance ... 26

2. Factors Determining High Low Compliance ... 27

3. Criteria Compliant Taxpayers ... 29

E. Tax Revenue Performance ... 29

F. Previous Research ... 33

G. Logical Framework ... 38

H. Hypothesis ... 40

CHAPTER III : RESEARCH METHODOLOGY A. Scope of Research ... 43

B. Sampling Methods ... 43

C. Data Collection Methods ... 44

CHAPTER IV : RESULT AND ANALYSIS

A. Research Objects ... 54

B. Characteristics of Respondents ... 59

1. Return Questionnaire ... 59

2. Description Statistics Demographics of Respondents ... 59

C. Discovery and Discussion ... 62

1. Data Quality Test ... 62

2. Result of Classical Assumption Test ... 66

3. Hypothesis Testing ... 70

CHAPTER V : CONCLUSION AND IMPLICATION A. Conclusion ... 77

B. Implication ... 77

LIST OF TABLES

No. Description Page

1.1 List of Domestic Revenue ... 1

2.1 Previous Research Table ... 33

3.1 Respondents Answer Score ... 44

3.2 Variable Operational Research ... 51

4.1 District in South Tangerang ... 58

4.2 Sample and Retun’s Rate ... 59

4.3 Descriptive Statistic ... 60

4.4 Description of Respondents Demographic Statistics By Education and Sex ... 61

4.5 Taxpayers Consciousness Validity ... 63

4.6 Tax Services Validity ... 63

4.7 Taxpayers Compliance Validity ... 64

4.8 Tax Revenue Performance Validity ... 65

4.9 Reliability Test ... 66

LIST OF TABLES

4.11 Multiple Regression Test ... 70

4.12 Determination Coefficient Test ... 72

4.13 Statistic F Test ... 73

LIST OF FIGURES

2.1 Type of Tax ... 11

2.2 Research Logical Framework ... 39

4.1 Scatterplot Graph ... 68

LIST OF APPENDIX

Appendix 1 ... 82

Appendix 2 ... 83

Appendix 3 ... 87

CHAPTER I INTRODUCTION

A. Background

Currently, tax is the main source of domestic revenue fund Indonesia. Most of the sources of revenues contained in the State Budget come from taxes and, approximately 78.8% of total revenues derived from tax revenue in 2012(www.fiskal.depkeu.go.id). As the largest revenue, taxes are used to finance government activities such as: expenditures for funding the government’s administration build and improve infrastructure, provide education and health facilities, finance officers, and financing activities of the government in providing the needs that are not generated by the private sector. Government expenditures to finance it could not be fulfilled with good if not supported by taxpayers and tax officials who are directly related to paying taxes. The role oftax revenues from year to year has increased its overall revenue it can be seen in Table1.1

Table 1.1

Domestic Revenues 2008-2012 (trillion rupiah) Year Tax Revenue Percentage of Tax Revenue Non-Tax Revenue Percentage of Non-Tax Revenue Total Percentage of Total

2008 658.7 67.2% 320.6 32.7% 979.3 100%

2009 619.9 73.17% 227.2 26.8% 847.1 100%

2010 723.3 72.8% 268.9 27.1% 992.2 100%

2011 878.7 75.4% 286.6 24.5% 1,165.3 100%

2012 1,019.3 78.8% 272.7 21.1% 1,292 100%

From the table 1.1 it can be seen that the ratio of the percentage each year in tax revenue and non-tax revenue, the amount of tax revenue is higher than non-tax revenue, as in 2008 the percentage of tax revenue was 67.2%, and non-tax revenue was 32.7%, as well as in 2012 the percentage of tax revenue was 78.8% and non-tax revenue was 21.1%, thus it can be said that tax revenue as a main source of income for the State.

In an attempt to optimize tax revenue, the government as policy makers make an improvement in tax reform program through intensification that seeks to increase tax revenues through increased taxpayer compliance, taxation apparatus quality capability, excellent service to the taxpayer, and guidance to taxpayers, administrative oversight , inspection, investigation and passive and active collection, also law enforcement.

Taxpayers consciousness in paying their taxes correctly is in the spotlight that not spared from the author's view, given the importance of public taxpayer consciousness to increase the tax ratio where the Indonesia’s tax ratio is still relatively low and has a tendency to fluctuate from year to year based on calculations conducted by the International Monetary Fund (IMF) and World Bank, and the Asian Development Bank (ADP) (bappenas.go.id).

Taxpayers consciousness formed by taxpayers perception dimensions, the taxpayer's knowledge, the characteristics of the taxpayer and the tax counseling. Taxpayers consciousness will increase if in the community when positive perceptions of tax appear (Suryadi, 2006). With increasing taxation knowledge of society through tax education both formal and non-formal

education will have a positive impact on taxpayers consciousness to pay taxes.Characteristics of taxpayers that represented by the condition of cultural, social and economic will dominant forming taxpayers behavior which is reflected in their consciousness in paying taxes. With taxation counseling conducted intensively and continuously will be able to increase understanding of the taxpayer's obligation to pay taxes as a form of national mutual cooperation in raising funds for the benefit of government funding and national development. With the increasing of revenue that government obtained from tax revenue, will also raise development that will be implemented by the government. Means that the increase in construction as a proof that tax revenue performance is increased. Research about taxpayers perception to tax revenue performance has been done by Maria Karanta in swedia (Suryadi, 2006). The result of the research conclude that positive society’s perspective influence taxpayers behave in paying their tax. So it will influence tax revenue performance.

Then after knowing and understanding the importance of taxation for sustainable development and the wheels of government, citizens consciousness to pay taxes is expected will be increased so the country’s tax ratio is increase. A low tax ratio indicating of tax collection is not optimal. Not optimal tax collection could be causes by several things such as low taxpayer compliance and corruption. Therefore it is natural if some parties want DJP to increase the tax ratio.

Tax services formed by the Human Resources (HR) dimensions, tax regulations and Tax Information System (Suryadi,2006). Excellent service quality standard to the community will be met if the human resources perform their duties professionally, disciplined and transparent. In this condition the taxpayer satisfied with the service provided to him, then they will tend to perform the obligation to pay tax in accordance with applicable regulations. Thus the tax information system and excellent human resources quality will generate better service tax. This condition will be very influential in improving tax revenue performance.Suryadi (2006), in his research shows that the service tax formed by the dimensions of the quality of human resources (HR), the provisions taxation, and taxation information system did not show any influence on tax revenue performance.

Taxpayers compliance is formed by the dimensions of the tax audit, law enforcement and tax compensation. The purpose of inspection is to test taxpayers compliance in implementing tax obligations. If law enforcement can provide justice and legal certainty so taxpayers will obey, obedient and disciplined in paying taxes. If taxpayers feel that tax compensation already fulfill as expectations then they will pay the tax in accordance with applicable regulations. With contionus socialization to all society level, they will understand the impact that will happen if they don’t pay tax. This is what should be instilled by tax officers in order to create society that has complied with the obligation to pay tax. With the compliance of the society as the taxpayers, it will automatically increase the tax revenue performance. Suryadi

(2006) in his research shows that the taxpayers compliance formed by the dimension of tax inspection, law enforcement, and compensation taxes show the influence on tax revenue performance.

According to Finance Minister Agus Martowardojo (vivanews.com), the compliance level of all elements in Indonesia toward tax still low. Such as individual taxpayer is still about 8.5 million of the 110 million who are actively working with SPT ratio only 7.7 percent. Meanwhile, the business entities that pay taxes, he added, only 446 thousand compared with a business that fixed domiciled and active as much as 12 million. "Only 3.6 percent the compliance.Lower tax payments caused GDP (Gross Domestic Product) is also low".

Several phenomena of cases occurring in the world of taxation Indonesia recently made public andtaxpayers concern to paytaxes. One of the cases was phenomenal from the Gayus Tambunan case. Former tax official IIIA group was suspected of accepting bribes and gratuities, and stored in a safe deposit box owned by him Rp74 billion. Gayus assets totaled reached 659.8 thousand U.S. dollars and 9.68 Singapore dollars. Gayus was also involved incases of alleged bribery prison chief Mako Brimob (Vivanews, Juny 2010). The condition can affect tax compliance and reduced public trust of taxation, because the taxpayers do not want any tax already paid by the tax authorities abused themselves.

Based on the description above, the author would like to further investigate the problem and compile them in thesis entitled: "THE INFLUENCE OF TAXPAYERS CONSCIOUSNESS, TAX SERVICES

AND TAXPAYERS COMPLIANCE ON TAX REVENUE

PERFORMANCE (Survey on The Individual Taxpayer in South Tangerang)"

B. Problem Formulation

In this research the problem that will discussed can be formulated as follows:

1. Is taxpayer consciousness significantly influence tax revenue performance?

2. Is tax service significantly influences tax revenue performance?

3. Is taxpayer compliance significantly influences tax revenue performance? C. Research Objectives and Benefits

1. This research was conducted with the aim of:

a. To analyze the taxpayer consciousness in influencing tax revenue performance.

b. To analyze the tax services in influencing tax revenue performance. c. To analyze taxpayer compliance in influencing tax revenue

performance. 2. Benefits of Research:

a. As an opinion for government in determining the policies to improve the tax revenue performance.

b. As a source of information for other researchers who are interested in the same issues and analysis that can be obtained for those who need the information.

c. For a comparison of the existing research, also as an opinion and reference for researchers who will conduct similar research.

d. As an opinion for DJP to know how importance taxpayers consciousness, tax services, and taxpayers compliance in increasing tax revenue performance.

e. As an opinion for tax authority to give better services regarding about taxpayers consciousness, and taxpayers compliance in order to increase tax revenue performance.

f. To contribute a knowledge for the university in order to improve quality of the university.

g. To finish the final assignment and finish the bachelor degree.

h. As an opinion for ministry of finance to know how much the taxpayers consciousness, tax services, and taxpayers compliance in influencing tax revenue performance.

CHAPTER II LITERATURE REVIEW

A. Basic Concepts of Taxation 1. Definition of Tax

According to Adam Smith tax isa contribution from citizen to support of the state.According to Feldmann (Suandy, 2008:9) taxes are achievement that unilaterally forced, and payable to the businessman, , no reciprocity, and its solely used to cover general expenses.

According to RochmatSoemitro(Resmi, 2009:1) tax is contribution from the people to the state treasury under the law (which can be enforced) by not getting reciprocal services directly addressed and used to pay for public expenditure.

From the various definitions of the tax, it can be drawn a conclusion that tax possess some basic aspects (Setiyaji and Amir, 2005):

1. Tax payment should be based on laws; 2. It can be enforced;

3. No direct reciprocity perceived by taxpayers; 4. Polling conducted by the state, and

5. Taxes are used to finance government expenditure (routine and development) for the public society.

From the various definitions of taxes, there are a few responses from experts and practitioners taxation. RochmatSoemitro stated that tax is debt, is society members debt to society. This debt is legally engagement. Although the tax was located in the area of political law, but closely

related to civil law and customary law. On the other hand, the fulfillment of tax obligations will have an impact on the economy, from microeconomics to macroeconomics. If members of the society fulfill their tax obligations properly, the economic mechanisms in the community will go well.

2. Type of Tax

Taxes are divided into three types based on the warrant parties (direct and indirect taxes), collector (state taxes and local taxes), and nature (taxes subjective and objective).

a. Type of taxes based on warrant parties:

1. Direct tax, is a tax payment that should be bourne by the taxpayer and is not transferable to another party.

Example: Income Tax

2. Indirect tax, is a tax payment that can be transferred to other parties.

Example: Sales tax, VAT, VAT-duty, stamp duty and excise. b. Types of taxes based on collect parties:

1. State tax or central tax, is a tax levied by the central government. Central tax is one of the state revenue sources.

2. Local taxes, are taxes collected by local governments. Local tax is one of local government revenue sources.

Example: Tax spectacle, advertisement tax, PKB (Motor Vehicle Tax), UN dues cleanliness, parking levies.

c. Types of taxes by their nature:

1. Subjective tax, is a tax that pay attention to the condition of the taxpayer. In this case there must be a objective reasons in determining the amount of tax that directly related to the ability of taxpayers to pay.

Example: Income Tax.

2. Objective tax, is a tax based upon the object itself regardless of the taxpayer.

Figure 2.1 Type of Tax

Source: Data are processed

3. Tax Function

Tax has two functions as follows:

a. Revenue function (Budgetary)

Tax have budgeter function means taxes is one of revenue to finance both routine and development expenditures, as a source of state finance, the government attempted to put as much money for the state treasury (Resmi, 2009:3).

b. Set function (Regulator)

Tax has a regulatory function, meaning that taxes as a gauge set or fulfilling government's policies in social and economic sector, as well as achieving certain objectives outside of the financial sector (Resmi, 2009:3). For example: the imposition of higher taxes on

Type of Tax

Based on warrant

parties

Based on collect

parties

Based on characteristic

Direct

Tax

Indirect

tax

State

tax

Local

tax

Subjective

tax

Objective

tax

liquor, so that sales can be controlled. Similarly the excise duty on cigarettes.

4. Tax Rates

Tax rate is a measure or standard tax collection. There are four types of tax rates, the proportional rate, fixed rate, progressive rates, and digressive rates (Waluyo, 2006:56).

a. Proportional rate

The form of a fixed percentage rate to any amount that is taxable, so the amount of tax payable proportional to the amount of value that is taxable.

b. Fixed rates

Rates form of a fixed amount against any amount that is taxable, so the amount of tax payable is fixed.

c. Progressive rates

Percentage rates used increase substantially if the amount taxed increases.

d. Digressive rates

The percentage rate used smaller when the greater amount taxed. 5. Taxpayers

Understanding of Taxpayer under Law 16 of 2000 on General Provisions and Tax Procedures Article 1 paragraph (1), namely: Taxpayer is an individual or entity under the provisions of the tax legislation is

determined to make a tax obligation, including collectors certain taxes or cutting taxes.

Entities is a group of people or capital either as a union to do business or not do business that includes a limited liability company, limited partnership, the other company, State Owned Enterprises or Region Owned Enterprises by name and in any form, firm, partnership, cooperative, pension funds, partnerships, associations, foundations, organizations, political social organization, or similar organization, agency, permanent establishment and other types of entities.

Enterprise taxpayers tax obligations and individual agencies in accordance with the Act KUP include:

a. Must register to nearby KPP to get a NPWP.

b. Must fill out and submit SPT correctly, complete and clear.

c. Must pay or deposit the tax due through the post office or a bank designated perception.

6. Theory Witholding Tax

According Suandy (2005:28), about tax collection:

a. Theory of Insurance

State in carrying out their duties, also includes the duty to protect the lives and property of the individual wealth. Therefore, the state is equated with the insurance company, to gain the protection of citizens

to pay taxes as a premium. However, these theories have long been abandoned and are now practically no defenders anymore.

b. Theory of Interest

According to this theory of tax payments have a relationship with the individual interests that derived from state job. The more an individual received or enjoying the services of a government job, the greater the tax.

c. Theory of bear power

This theory says that tax collection should be paid according to the strength of the taxpayer (individuals). Thus, the pressure of all taxes shall be in accordance with the Taxpayers carry power with respect to the amount of income and wealth, as well as the taxpayer expenditure. d. Theory of Purchasing Power

According to this theory the tax collection function when viewed as a symptom of society, can be equated with a pump that is taking the purchasing power of the society household for the state household and then maintain life and to bring in a certain direction. This theory teaches that organizes public interest is what canbe considered as the basis of justice tax collectors, not individual interests, nor the interests of the state, but rather the interests of the society include both.

e. Absolute Liability Theory

This theory is based on understanding of state organization (OrganischeStaatsleer) which teaches that the state as an organization has a duty to hold the public interest. States shall take the necessary actions or decisions, including the decision in the field of taxation. With such properties, the state has an absolute right to collect taxes and people have to pay taxes as a sign of devotion. According to this theory the basic tax law lies in the relationship between the people and the state, which the state shall be entitled to tax and duty people pay taxes.

7. Tax Payable

According to the law No. 28 year 2007 of tax payable is the tax that should be paid someday, in a tax period, the tax year or in part in accordance with the provisions of tax laws.

8. Emergence of Tax Payable

There are two teachings that regulate the emergence of tax debt (as the recognition of the tax debt), material teaching and formal teaching (Resmi, 2009:13).

a. Material Doctrine (Self Assessment System)

Tax debts emerge from applying of tax legislation as well as fulfill subject terms and object terms. "Naturally" means that the emergence of the tax debt intervention of tax officials is not necessary, as long as the conditions prescribed by law have been met. Someone is taxed

because of some condition and action. This doctrine is applied to the self-assessment system.

b. Formal Doctrine (Official Assessment System)

Tax debt emerge because the law at the time of tax assessment issued by the Director General of Tax. So, as long there is no tax assessment then no tax debt and there will be no billing although subject terms and object terms conditions have been met. The doctrine is applied to the official assessment system,

9. Withholding Tax Principle

To achieve collecting purposes, tax need to uphold collecting principles in choosing alternative levied. So there is harmony in tax collection with the purposes and principles required. In the book An Inquiri into the nature and cause of the wealth of nations (Mansyuri, 2002:70), Adam Smith states that tax collection should be based on the following principle:

a. Equality

Withholding tax must be fair and equitable, means that the taxes imposed on an individual who should be proportional with the ability to pay and according to the benefit received.

b. Certainty

Tax assessment was not determined arbitrarily. Therefore, the taxpayer must have a clear and definite amount of tax payable, when it must be paid, and payment deadlines.

c. Convenience

When the taxpayer must pay, is accordance with the best moments that do not complicate the taxpayer, for example, when taxpayers earn fee. This collection system is called pay as you earn.

d. Economy

Economically, the cost of collection and fulfillment of tax obligation costs for taxpayers is expected to a minimum, as well as the burden borne by taxpayers.

10. Witholding Tax System

Basically there are 3 applicable tax collection system, the official assessment system, self-assessment system, and withholding system (Suandy, 2008:17). Official assessment system is a tax collection system where the amount of tax to be paid or payable by the taxpayer calculated and set by fiskus/tax authorities. Next, self assessment system, in this system Taxpayers calculate, pay and report taxes payable by himself where the tax officials in charge of conducting counseling and supervision. And last witholding system where in this collection system amount of tax payable is calculated and deducted by a third party.

Initially the tax collection system in Indonesia using the official assessment system, but after the introduction of the first tax reformation, the system was changed to self assessment. The changes are aimed to prevent fraud that would arise if a tax official in direct contact with the taxpayer. Although these restriction contacts to break collusion, but the

impact on state revenues is meaningful. Taxpayers report their business so they pleased. The trend, reporting taxpayer is far below its actual

This system is actually only be executed well in an economic system that has been established. In these countries, the accounting system has been developed making it easier for tax officers to conduct surveillance and the existence of a complete transaction evidence. Our society is not yet mature enough to be asked to fill in the amount to be payment of properly. This is because we are still in the transition phase is often characterized by low consciousness of the law.

Lack of consciousness of the law is shown by the many cases of taxation that occurs. If the government wants to use this system, the government should increase public consciousness of the importance of taxes for the taxpayer so that the taxpayers with his own consciousness pay taxes in accordance with the actual conditions.

B. Taxpayers Consciousness

Consciousness is the behavior or attitude of an object which involve assumptions and feelings as well as the tendency to act in accordance the object. Thus it can be said that the Taxpayer Consciousness in paying taxes is a form of taxpayer behavior or outlook feelings involving knowledge, belief and reasoning with tendency to act on the stimulus provided by the system and The tax provisions. Of literature and the results, several internal factors that dominant forming the taxpayers consciousness behavior to comply are:

1. Taxpayers Perception

Taxpayer consciousness to fulfill their tax obligations increased if the public perception appears positive against taxes. Torgler in Ritonga (2011) states that the payer consciousness taxes to dutifully pay taxes associated with the perception that include paradigm will be the tax function for financing development, usability taxes in the provision of public goods, as well as justice (fairness) and legal certainty in the fulfillment of tax obligations. Availability public goods is a matter of confidence in the use of taxpayer taxes paid. If taxpayers feel that the taxes paid can not be properly managed by the government, so that taxpayersfeel the real benefit of tax paid, University of North Sumatra Taxpayers would then tend not to obey.

2. The level of knowledge of the provisions of the applicable tax.

The level of knowledge and understanding of the provisions of the taxpayers existing taxpayers effect on behavior of consciousness to pay taxes. Taxpayers who do not understand the tax laws are clearly taxpayers tend to be disobedient, and vice versa taxpayers increasingly aware of the tax laws, the more taxpayers also aware of the sanctions that will be accepted if the neglect tax obligation. Research conducted by Prasetyo (Ritonga, 2011) provide results that taxpayers understanding of regulatory taxation significant effect on the consciousness of the taxpayertax reporting.

3. The financial condition of the taxpayers

Financial conditions are factors that affect the economy tax compliance. Financial condition is the ability of financial companies are reflected in the level of profitability and cash flow. Corporate profitability is onethe factors that influence the consciousness to comply with regulationstaxation. Companies that have high profitability tend tax reporting honestly from the companies that have low profitability. Companies with low profitability inUniversity of North Sumatra generally experiencing financial difficulties and tend to tax non-compliance. Similarly, the cash flow condition and the liquidity.

C. Tax Services

Service is a way to serve (or preparing to help take care of all the needs that a person needs). Meanwhile, fiskus is tax authorities. So that the tax authorities service means as a way to help take care or prepare all someone’s necessities needed (in this case the taxpayer).

According to the Toy Prastiantono quoted by AgusNugrohoJatmiko (2006), the success rate of tax revenue not only influenced by tax payer but also influenced by tax policy, tax administration, and tax law. Last three factors inherent and controlled by the tax authorities themselves, while the tax payer dominated factor from inside of the taxpayer itself. Tax authorities in

carrying out their duties to serve the public or taxpayers is highly affected by the tax policy, tax administration and tax law.

Study Singh (Ritonga, 2011) also showed that the taxpayers were satisfied with the services provided by the government, taxpayers will feel obliged to comply with the law, including tax law. It is suggests that satisfaction with the tax services can determine the levels of tax compliance. Services have certain characteristics that distinguish the product goods. Zemke in Collins and McLaughlinm (Ritonga, 2011) identified several characteristics of the service as follows:

1. Consumers have the memories. Experience or memory is not can be sold or given to anyone else.

2. Purpose the provision of services is unique. Every consumer and each contact is special.

3. Occurs when a particular service, which can not be stored or sent an example.

4. Consumers are partners involved in the production process. 5. Consumers do quality control by comparing hope to experience. 6. If an error occurs, the only way that can be done tofix it is apologize. 7. Employee morale plays a very decisive.

Macaulay and Cook (Ritonga, 2011) said that the ministry is the image organization. Satisfactory service consists of three components, and all reflects the organization's image. The three component sare: (a) the quality

the resulting products and services, (b) how employees provide services, and (c) personal relationships formed through the service.

The tax authorities in charge and utilize human resources needed to increase taxpayers compliance. Empirically it has been proved by Loekman Sutrisno in Jatmiko (2006 )who found that there is a relationship between the payment of taxes to the quality of public services to taxpayers in the urban sector. The tax authorities are expected to have competence in the sense of having the expertise (skills), knowledge, and experience in this case tax policy, tax administration and tax laws. Besides the tax authorities should have high motivation as a public service (Jatmiko, 2006).

Quality service is the service that can provide satisfaction to customers and stay within standards of service that can be justified and must be done continually. In a simple definition of quality is a dynamic state associated with products, human service, process and environment that fit or exceed the expectations of those who want it. If the services of an agency does not meet customer expectations, the services are not qualified (Supadmi, 2006).

D. Taxpayers Compliance

According to Milgram (Ritonga, 2011) compliance associated with compliance on the authority of the rules. In a more detailed sense, Hasseldine (Ritonga, 2011) suggests that compliance is to report all property wealth taxpayer of record at the specified time and returns report accurate tax liability, according to the input code regulatory and court decisions at the time

the application is recording. According Safri Nurmantu (Ritonga, 2011), tax compliance is defined as a state where the taxpayer meets all tax obligations and exercising the right of taxation . There are two kinds of compliance by Safri Nurmantu (Ritonga, 2011), namely: formal adherence and compliance material. Formal complianceis a state where the taxpayer to meet the tax obligations formal accordance with the provisions of the tax laws. For example provisions deadline Income tax returns (SPT VAT) held on march 31. If the taxpayer had reported income tax returns yearly on or before march 31, then the taxpayer has to meet.

In the context of the Self Assessment System adopted by Indonesia, complianceis expected that compliance is voluntary and not a forced compliance. Compliance is required by the Government against the taxpayer in the system Self Assessment , of course, not adherence without supervision , because veryrisky and occurs on the experience in many countries that are not all taxpayers comply, in many ways they try to minimize evenavoid taxes, either through tax avoidance , which exploit loopholesbecause the tax laws are not set or have a lot of interpretationdifferent , or through tax crime is smuggling taxes (taxevasion).In this case Brooks (Ritonga, 2011) states there are three common approachesused to analyze tax compliance namely:

1. Economic Approach

According to the economic approach to tax compliance ismanifestations of human behavior that make a rational decisionbased on an evaluation of benefits and costs.Factorsdetermine compliance with this approach is the tariff rate, the structure of sanctions, andchance ofdetection by law.

2. Psychological approach

The approach recognizes the tax compliance behavior is influenced byfactors of one's perspective on the morality of smugglingtax -related ideasand its values , perceptionsand attitudes toward the possibility probablitasdetected, the fineand others, changes in behavior, subjective framework for decisionstaxes.

3. Sociologicalapproach

This approach saw the causes of deviant behavior onethrough the framework of the social system. According to sociologists, encouragementor social pressure will form just as effective behaviorwith a system of reward and punishment made by the Government.Therefore according to this approach the factors that affect the taxavoidance and tax evasion is the attitude of the government, a viewconcerning the enforcement by thegovernment , views onjustice and taxation systems , contact the tax office and demographic characteristics.

Gibson in AgusBudiatmanto (Jatmiko,2006)said that compliance is motivated person, group or organization toact or not act in accordance

with established rules. Someone submissive behavior is the interaction between the behavior of individuals, groups and organizations (Jatmiko, 2006).

In terms of taxes, the rules that apply are the rules of taxation. So in relation to abiding taxpayers, the Taxpayer compliance is a sense of devotion to carry out the provisions or taxation rules that are required or requested to be implemented (Jatmiko, 2006). Since the tax reform in 1983 and the last in 2000 with the reversal Tax Act into Law no.16 of 2000, Law no. 17 of 2000 and Law no. 18 of 2000, the tax collection system in Indonesia is the Self Assessment System. According Mardiasmo (2009), Self Assessment System is tax collection system that authorizes taxpayers to determine for themselves the amount of tax payable. In this system implies that taxpayers have an obligation to count, calculate, pay and report income (SPT) right, complete and timely.

Eliyani in AgusNugrohoJatmiko(2006) stated that the Taxpayer compliance is defined as the time to enter and report the required information, fill out the correct amount of tax payable, and pay taxes ontime without coercive action. Noncompliance arises if one define requirements are not met. Another opinion on compliance Taxpayers also presented by Novak as quoted by Kiryanto (Jatmiko, 2006), which states a climate of taxpayer compliance are:

2. Filling out tax forms correctly;

3. Calculating the correct amount of tax; 4. Paying taxes on time.

So the higher the correct count and taking into account rate, accuracy of deposit, as well as filling and fill the Notice Letter (SPT) taxpayer, it is expected that the higher the level of compliance and taxpayer in fulfilling their tax obligations (Jatmiko, 2006).

1. Type of Taxpayer Compliance

According Nurmantu (2009), there are 2 (two) types of compliance, namely formal adherence and compliance material.

a. Formal Compliance

Formal compliance is a situation where the taxpayer to meet tax obligations with a focus on the name and form of liability only, without regard to the nature of that obligation. For example, submit SPTPPh before 31 March to the Tax Office (KPP), regardless of whether the content of Tax Notice Letter (SPT) PPh it is correct or not, and the most important thing SPT PPh be submitted before March 31. b. Material Compliance

Material compliance is a situation where the taxpayer in addition to meeting obligations associated with the name and form of tax obligations, as well as particularly fulfilling nature of taxation obligations. In here, related taxpayer apart from the date submit SPT PPh also noticed correctly inside SPT PPh.

According Gunadi (2005:5) Taxpayer compliance is a taxpayer has a willingness to meet its tax obligations in accordance with applicable regulations without the need to hold the examination, investigation, carefully, warning, or threat, and sanctions participation in law and administrative.

Thus, it can be concluded understanding of taxpayer compliance is a condition in which the taxpayer has a willingness to meet tax obligations without any examination or sanctions imposed and voluntarily willing to pay its obligations in the form of taxes in accordance with applicable regulations.

2. Factors Determining High Low Compliance

According Nurmantu (2009), there are several factors that determine the level of tax compliance, including clarity laws and regulations implementing the tax, the cost of compliance, and a role model.

a. Clarity

The more clear the laws and regulations implementing the tax, the easier for taxpayers to meet tax obligations. The more complicated the implementation of the tax rules, especially when there is uncertainty and disjunctive rules, the more difficult for taxpayers to meet tax obligations.

b. Cost of Compliance

fees issued by the government to collect taxes called administrative cost and expenses incurred by the taxpayer for taxation obligations is called compliance cost. Compliance costs are all costs both physical and psychologically to be borne by the taxpayer to meet tax obligations. Compliance costs consist of fees for consultants / accountants, personnel costs, transport costs to the tax office / bank / treasury, photocopy costs as the physical cost and psychological costs in the form of stress, curiosity, and anxiety. The lower the cost of compliance, the easier it is for taxpayers to implement tax obligations. Request copies more than once by section / official tax office under one roof is an example of unnecessary compliance costs.

c. Modeling

Model system in the taxpayer’s community in Indonesia to be "the greatest" taxpayer can be a factor that can increase the sense of tax compliance. Being one of the 100 largest tax payers pushing conglomerates in both central and regional levels toincrease the tax payments which also leaned on the level of compliance. The example given by president to fill SPT and submit to the Tax Office (KPP) before March 31 contributed to the department heads, business leaders to encourage members of organizations to follow the lead of the president of the SPT before the deadline. Conversely, if the head of even the neighbors who do not pay taxes, or not submit SPT even not

yet have a NPWP would be a negative role model for community members not to implement Taxpayers tax obligations.

3. Criteria Compliant Taxpayers

According to the Decree of the Minister of Finance numbers 544/KMK.04/2000, complianttaxpayers criteria are:

1. Timely submit SPT

Timely submit of SPT include submitting SPT that are not too late in the last year for the tax period January to November is not more than three (3) tax period each type of tax and consecutively. Notice Letter Period of late has been submitted no later than the deadline for submission of next tax Notice Letter Period.

2. It has no tax arrears for all types of taxes, unless the delinquent taxes that have been licensed in installments or defer tax payments.

3. The financial statements audited by a public accountant or Government Oversight Financial Institutions unqualified for 3 consecutive years. 4. Never convicted of a crime in the field of taxation based on court

decisions that have been legally binding for a period of 5 (five) years.

E. Tax Revenue Performance

According Rivaland Fawzi (Ritonga, 2011) performance is a function of motivation and ability. To complete the task or job, one must have a degree of willingness and a certain level of ability. Willingness and skills of a person is not effective enough to work something without a clear understanding of what

performance can be measured through the four aspects of performance, namely: the aspect of speed, quality aspects, aspects of the service, and value aspects. Jewell & Marc (Ritonga, 2011) says that assessment performance is the process used by organizations to assess the extent to which members have been doing their job satisfactorily. Performance assessment can be conducted on the performance of individuals and groups of people who work in organized.

Understanding of the organization's performance is the answer to success or failure of organizational goals that have been set. The supervisor or managers often do not notice it unless it's already very bad or anything so completely wrong. Too often managers do not know how bad the performance has dropped so companies / agencies face a serious crisis. Bad impressions profound organizational consequences and ignore the warning signs of diminished performance. Some management experts formulate the definition of performance as follows:

a. Stoner in his book Management suggests that performance is a function of motivation, skills and role perception.

b. Bernardin and Ruseil (Bandarsyah, 2009) as presented in the book Achmad S. Ruby defines performance as the recording of the results obtained from the job functions and specific activities for a certain period. c. Handoko in his Personnel and Resource Management defines performance

as a process in which organizations evaluate or assess employee performance.

d. Prawiro Suntoro (Bandarsyah, 2009) in book Dandian Flag Merry suggests that the performance is the result of work that can be accomplished person or group of people within an organization in order to achieve organizational goals within a certain time period.

e. According to John Whitmore in Coaching for Performance (Bandarsyah, 2009) performance is the implementation of the functions required of someone . So, the performance is an act, a performance, a public exhibition ability. Furthermore, John Whitmore argues that performance is a condition that must be known and confirmed to certain parties to determine the level of achievement of an agency linked to embrace the vision of an organization or company and find out the positive and negative impacts of an operational policy. Performance is an overview of the implementation of an activity level of achievement in realizing the goals , objectives , mission and vision of the organization as stated in the strategic planning of an organization.

f. As'ad (Bandarsyah, 2009) defines performance as a person's success in carrying out a job.

g. Kurb (Bandarsyah, 2009), defines performance as a combination of work and organizing one's personal characteristics.

h. Gilbert (Bandarsyah, 2009) suggests that the performance is what can be done in accordance with the duties and functions.

i. Moh. Pabundu Tika (Bandarsyah, 2009) in his book Culture and Organizational Performance Improvement Company argued that the

elements contained in the performance are the results of the work function, the factors that influence employee performance such as motivation, skills, perceptions of the role and so on , the achievement of organizational goals as well as the period of time particular.

So it can be concluded that the definition of the performance are the results of the work or activities of individuals or groups within an organization that is affected by a variety of factors in order to achieve organizational goals within a certain time period.Tax revenueisallstate revenueconsisting ofdomestic taxesandinternationaltradetaxes(Article 1 paragraph3of LawNo.4 of 2012). From those definitions it is the overall tax revenue performance can be defined as motivation a person or group on order to achieve tax revenue.

F. Previous research

Table 2.1

Previous Research Table

Researcher (Years) Research Title Investigational variables Research Methodology Research (Conclusion) Suryadi (2006) Causal Relationship Model Consciousness, Service, Tax Compliance and influence to Tax Revenue Performance: A Survey in East Java

1. Taxpayers Consciousness 2. Tax services 3. Taxpayer

Compliance 4. Tax Revenue

Performance Methods Analysis of Structural Equation Modeling (SEM) 1. Taxpayers conclusions no significant influence on the tax revenue performance. 2. Tax services no

significant influence on tax revenue performance. 3. Taxpayers

compliance

significant influence on tax revenue performance. Source: Data Processed

Research (Years) Research Title Investigational Variables Research Methodology Research (Conclusion) Pandapotan Ritongga (2011) Analysis of Consciousness, Service, Taxpayer Compliance to Performance of KPP East Medan. 1.Taxpayers Consciousness 2.Taxation services 3.Taxpayer Compliance 4.KPP Organizational Performance Methods Analysis of Structural Equation Modeling (SEM) 1.Taxpayers Consciousness significant influence on organizational performance LTO. 2.Services significantly influence KPP organizational performance. 3.Taxpayer Compliance significant influence on KPP organizational performance. Source: Data Processed

Research (Years) Research Title Invertigational Variables Resarch Methodology Research (Concusion) Ni ketut Muliari and Putu Ery Setiawan (2011) Influence of Perceptions About Tax Sanction and Taxpayers Consciousness in Compliance Reporting the personal

taxpayer in East Denpasar KPP Pratama.

1.Perception of tax penalties 2.Taxpayers Consciousness 3.Taxpayer Compliance reporting the Personal taxpayer Multiple Linear Regression Analysis 1. Taxpayer perceptions about the tax penalty partially positive and significantly for compliance

reporting personal taxpayers in East Denpasar KPP Pratama. 2. Taxpayer consciousness partially positive and significant influence on compliance reporting personal taxpayers in East Denpasar KPP Pratama. Source: Data Processed

Researcher (Years) Research Title Investigational Variables Research Methodology Research (Conclusion) Agus Nugroho Jatmiko (2006) Influence of Taxpayer Attitude toward Penalties Execution, Service of tax authorities and Consciousness Against Taxation Taxpayer Compliance. 1.Taxpayer Attitudes toward penalties execution. 2.Taxpayer attitudes towards service of tax authorities. 3.Taxpayer attitudes toward tax consciousness 4.Taxpayer Compliance. Multiple Regression Analysis

1.Taxpayers attitudes toward the

implementation of a partial penalty has a significant positive influence on

taxpayers compliance. 2.Taxpayers attitude

towards service of tax authorities partially have a significant positive influence on taxpayers compliance. 3.Taxpayers attitudes

towards taxation consciousness partial has a significant positive influence on taxpayers compliance. Source: Data Processed

Reasercher (Years) Research Title Investigational Variables Research Methodology Research (Conclusion) Sartika and Rini (2009) Influence of Spiritual Intelligence, Tax Service Performance and Tax Sanctions Assertiveness Against taxpayer Motivation in fulfilling the Tax Obligation.

1.Spiritual intelligence 2.Performance of

tax service 3.Tax sanctions

assertiveness 4.Taxpayers motivation in fulfilling tax obligations Multiple Regression Analysis

1. Spiritual intelligence has a significant influence on the taxpayers motivation variable

2. Performance of tax service has no significant

influence on the taxpayers motivation variable 3. Tax sanctions

assertiveness has significant influence on the taxpayers motivation variable

4. Spiritual intelligence, performance of tax service and tax sanctions

assertiveness jointly has a significant influence on taxpayers motivation. Source: Data Processed

G. Logical Framework

State revenue in the tax sector is the largest contributor to the state budget. Since the revenues from oil and gas cannot fulfill most of the national budget, the government is focusing tax sector as a state revenue sector. So, the taxpayer consciousness and compliance needs to be improved in order to increase tax revenues. As well as the service of the tax authorities (fiskus) should also be addressed so that the revenue that obtained can be optimal. Hopefully with improved consciousness, tax compliance and services of tax authorities will have a positive impact on tax revenue performance. Logical framework of this research are presented in Figure 2.2 on the next page.

Research Logical Framework Figure 2.2

Taxasa significant source ofstate revenue, so thattaxrevenue performanceis essentialfornational development, and there are some factors which can

influence tax revenue performance

Theory Basis :The theoryof taxpayers consciousness, theory of tax services, and theory oftaxpayers compliance

Independence Variable Dependence Variable Taxpayers Consciousness (X1)

Tax Services (X2)

Taxpayers Compliance (X3)

Tax Revenue Performance (Y)

Analysis Method

Quality Data Test (Validity Test, Reliability Test)

Classical Assumption Test

Multiple Regression Test (R2 Test, F Test, t Test)

Result and Analysis

H. Hypothesis

According Indriantoro and Supomo (2002) hypothesis in quantitative research is the answer to a problem or a question based on research developed theories need to be tested through the process of selecting, collecting, and analyzing data. The hypothesis states that supposedly logical relationship between two or more variables in the formulation of propositions that can be tested empirically. This hypothesis has multiple functions in the study are as follows:

1. Hypothesis explaining and solving research problems rationally.

2. Hypothesis states that the research variables need to be tested empirically. 3. Hypothesis are used as guidelines for selecting test data methods.

4. Hypothesis became the basis for making conclusions.

1. Taxpayers Consciousness to Tax revenue performance

Taxpayers consciousness formed by taxpayers perception dimensions, the taxpayer's knowledge, the characteristics of the taxpayer and the tax counseling. Taxpayers consciousness will increase if in the community when positive perceptions of tax appear (Suryadi, 2006). With increasing taxation knowledge of society through tax education both formal and non-formal education will have a positive impact on taxpayers consciousness to pay taxes. Characteristics of taxpayers that represented by the condition of cultural, social and economic will dominant forming taxpayers behavior which is reflected in their consciousness in paying taxes. With taxation

counseling conducted intensively and continuously will be able to increase understanding of the taxpayer's obligation to pay taxes as a form of national mutual cooperation in raising funds for the benefit of government funding and national development.. Research on taxpayer perceptions of the tax revenue performance is doing by Maria karanta, et. al (2000) in Sweden, concluded thatthe positive public perception can affect the behavior of the taxpayer to pay taxes that would significantly affect the performance of the Swedish National Tax Board.

H1: Taxpayer consciousness has significant influence ontax revenue performance.

2. Tax Service on Tax revenue performance

Tax services formed by the Human Resources (HR) dimensions, tax regulations and Tax Information System (Suryadi,2006). Excellent service quality standard to the community will be met if the human resources perform their duties professionally, disciplined and transparent. In this condition the taxpayer satisfied with the service provided to him, then they will tend to perform the obligation to pay tax in accordance with applicable regulations. Thus the tax information system and excellent human resources quality will generate better tax service.

Quality services should be pursued to provide safety, comfort, smoothness and legal certainty can be counted for (Supadmi, 2006). Nerre (Suryadi, 2006), found that in terms of civilizing then there should be

to taxpayers by making the tax system and tax policy and good practice which historically have to consider the culture of a country. Karanta, et. al (Suryadi, 2006), emphasizes the importance of the quality of personnel (HR) taxation in providing services to the taxpayer. All in all a good job means that the tax authorities should be completely capable and expert on all the expertise in their respective fields.

H2: Tax Service has significant influenceon tax revenue performance.

3. Taxpayer Compliance to Tax revenue performance

Taxpayers compliance is formed by the dimensions of the tax audit, law enforcement and tax compensation. The purpose of inspection is to test taxpayers compliance in implementing tax obligations. If law enforcement can provide justice and legal certainty so taxpayers will obey, obedient and disciplined in paying taxes. If taxpayers feel that tax compensation already fulfill as expectations then they will pay the tax in accordance with applicable regulations. Taxpayers compliance that measured from tax audit, law enforcement and tax compensation significantly influence the tax revenue performances. Nominal tax assessment has increased tax revenue, but the increase in nominal acceptance is not followed by a significant increase in the average ratio of profit before tax on sales and the average tax revenue based on the ratio of income tax to sales (Suryadi, 2006).

H3: There is a significant influence between Taxpayer Compliance to Tax Revenue Performance.

CHAPTER III

RESEARCH METHODOLOGY

A. Scope of Research

The study takes the research object inSouth Tangerang. Which is this research is a causality that is research that aims to determine the relationship and influence between two or more variables. Variables to be analyzed in this study were independent variables taxpayer consciousness, taxservice, and the taxpayer compliance against the dependent variable istax revenue performance.

B. Sampling Methods

The sampling techniqueis done byconvenience samplingmethod, which is ageneral termthat includesvariations in thelevel ofrespondent selectionproceduresthememberpopulationsampling techniqueis based onconveniencealone. Someonesampledby chancepeoplehadbeen thereorinvestigatorsknow the person. This type of samplingis very goodifusedfor researchassessment, which is thenfollowed byadvanced researchsampletakenat random(Sugiyono, 2007:56).

Sampling method used in this study is convenience sampling is a general term that includes a wide variety of respondent selection procedures. Convenience sampling means that the sample units drawn easily reachable, no trouble, easy to measure, and are cooperative (Hamid, 2010:18).

C. Data Collection Methods

In this study, data collection is done by the following techniques:

1. This study used a questionnaire instrument that will be distributed to the respondents made reference to the Likert scale models. Each of the five alternative answers available answers given weight value as follows:

Table 3.1

Respondents Answer Score

No Respondents answer Score

1 Strongly Agree / Always 5

2 Agree / Often 4

3 Less Agree / Sometimes 3

4 Disagree / Never 2

5 Strongly Disagree / Not Ever 1 Source: Data are processed

2. Literature (Library Research), which is getting the data and information needed during the writing of this paper were derived from literature / relatedresource and can be thought of which are related to thesis writing further.

D. Method of Data Analysis

The method of data analysis is a method used to process the research data by using the simplification of data in a form thatis easy to read and interpreted (Ghozali, 2011:5). The method used in this study is a quantitative method.To find out how much the level of consciousness of the taxpayer, the tax service quality, and taxpayer compliance, variablesmeasurement tools required that is using scale model or called Likert type format. Likert method designed to measure the level of consciousness, service, and compliance by answering various questions about the variables that will be tested.

Development usage of procedures which represent a bipolar continuum. At the end of the left (a small number) represents a negative answer, while the right end (with a large number) describing the positive.

1. QualityTest Data

In a study to obtain valid and reliable data should be tested against the data. Instrument used for testing data are:

a. ValidityTest

The validity means that how far the precision and accuracy of a measuring instrument in doing the measuring function. A test or measuring instrument can be said to have a high validity when measuring instrument doing their functions properly. Validity indicates how farthe measuring device is able to measure what you want to measure.

Testing the validity of the thesis is done by comparing the value of r count and r table for the degree of freedom (df) = n-2, in this case n is the number of samples.

b. Reliability Test

If a measurement tools has been declared valid the next step is to measure the reliability of the tools. As a measure that shows the consistency of the measuring instrument to measure the same phenomenon in other occasions. Reliability tests aim to see the consistency of a measuring instrument will be used whether the gauge is accurate, stable, and consistent.

2. Classical Assumptions Test

In this classical assumption test that used is the normality test data, multicollinearity, autocorrelation and heteroscedasticity.

a. MulticollinearityTest

Multicollinearity test aims to test whether the regression model found a correlation between the independent variables (independent). A good regression model,corelation should not happen between independent variables (Ghozali, 2011:91). To detect the presence or absence multicollinearity in the regression model can be seen from the amount of the value of the Tolerance and VIF (Variance Inflation Factor). Free regression from multicollinearity trouble if the Tolerance value> 0.10 or equal to the value of VIF <10 (Ghozali, 2011:92).

b. HeteroscedasticityTest

Heteroscedasticity test aims to test whether in the regression model there is unequality variance from one residual observation to other observation. If the variance from one residual observation to another observation is fixed, then it is called homokedastitas and if it is different called heteroscedasticity. A good regression model is a regression model that is homokedastitas. Detection the presence ofheteroscedasticitycan be do by looking at whether there are a particular pattern in scatterplot graph between the predictive value of the dependent variable (ZPRED) with the residual (SRESID) where the Y axis is the predicted while X is residual. If there are certain patterns so that will indicate there has been heterokedestitas, but if there is no clear pattern and the points spread above and below zero on the Y axis, so it heteroscedasticity does not happen (Ghozali, 2011:105).

c. Normality test

Normality test data aims to test whether the regression model, both independent and dependent variables, have been distributed normally. Good regression models is regression model with normal distribution data or near normal. To determinewhether or not the normal distribution of the data can be detected by looking Normality Probability Plot (P-Plot). If the data (dots) spread around the diagonal line and follow the direction of the diagonal line or line histogram,

then showed a normal distribution pattern and regression models have met the assumptions of normality (Ghozali, 2011:149).

3. Hypothesis Testing

Hypothesis testing is done through coefficient determinant testing Adjusted R Square (Adj R ²), F test and t test.

a. Test Adj R ²

The coefficient of determination (Adj R ²) was essentially to measure of how far the ability of the model in explaining the variation in the dependent variable. Adj R ² value is between zero and one. If the value of Adj R ² ranges from almost one, then the stronger the ability of the independent variables in explaining the dependent variable, and vice versa if Adj R ² values closer to zero, meaning the weaker the ability of the independent variables in explaining the dependent variable (Ghozali, 2011:98).

a. F Test

F statistical test basically shows whether all the independent variables included in the model have an influence together on the dependent variable. To accept or reject a decision by comparing the error rate 0.05 (Ghozali, 2011:88). Basis for decisionmaking are as follows: 1. If the probability> 0.05 and then Ha rejected.

a. TTest

T test was conducted to examine the partial regression coefficients of the independent variable and shows how far the influence of the explanatory or independent variable in explaining individual variation in the dependent variable and used to determine the presence or absence of influence of each independent variable individually against the dependent variable is tested at significance level of 0.05 (Ghozali, 2011: 164). Significance level used is 5%, with degrees of freedom DF = (nk-1), where (n) is the number of observations and (k) is the number of variables. This test is done by comparing the calculated t with t table with the following conditions:

H0 is accepted if t count <t table for α = 5% H1accepted if the t count> t table for α = 5%

E. Variable Operational Research

Variable is anything that can be given a wide range of values (Indriantoro and Supomo, 2002). There are two kinds of variables namely:

1. Independent variables

Independent variable is a type of variable to explain or affect other variables. Independent variables used in this study include taxpayer consciousness, taxservice quality and Taxpayer Compliance.

2. Dependent variable

Dependent variable is a type variable described or influenced by independent variables. The dependent variable is the variable that is affected or is the result due to the independent variable. Dependent variable of the study was the tax revenue performances.

Operational definition is discribedvariable operationalicaly based on characteristics thatobservable that allow researchers to conduct a observation or measurement of an object or phenomenon. Operational research variables are determined based on the parameters used in the study size. As for how the measurement of the variables that will be tested is to use a Likert scale.

Here are the variables that will be studied:

Table 3.2

Variable Operational Research

Variable Indicator No of

question

Scale

Taxpayer Consciousness

1. Necessary of paying tax 1

Interval 2. Risk if not paying tax 2

3. Count, pay, and reporting tax voluntary

3 4. Necessary of attend tax

seminar

4 5. Knowing the existence of tax

law

5 6. Understand about your tax

obligation

6 7. Understand about tax function 7 8. Count, pay, and reporting tax

properly

8 9. Doing your tax obligation

without any force

9

Tax Services

1. Good service from tax officers 1

Interval

2. Friendly in serving 2

3. Good tax officers quality 3 4. The existance of tax officers is

needed

4 5. Good service to every

customer

5 6. Tax officers give solusion 6 7. Tax officers polite in serving 7 8. Tax officers keeping customers

privacy data

8 9. Tax officers able to answer any

question

9 10.Tax officers able to solf any

problem

10 11.Tax officers able to

communicate with all costumer properly

Variable Indicator No of question

Scale

Tax Services

12.Tax officers ready to answer any question

12

Interval 13.Tax officers honest and

professional

13 14.Taxofficers easy to contact 14 15.Tax officers ready to help in

filling the sheet

15

Taxpayers Compliance

1. Not incumbent in reporting all the income

1

Interval 2. Following your society in

reporting tax not properly

2 3. Not comply because didn’t

know the procedure

3 4. Tax already balance between

right and obligation

4 5. Tax rate already fit society

ability to pay tax

5 6. Tax collection already fit with

economy condition

6 7. Ontime in tax payment 7 8. Ontime in reporting SPT 8 9. Counting your tax properly 9 10.Don’t have tax arrears 10 11.Understand about tax certainty 11 12.Never get punishment 12

Tax Revenue Performance

1. Proper APBN allocation 1

Interval 2. Proper APBD allocation 2

3. Common property maaged well

3 4. Region tax revenue

administrated well

4 5. State tax revenue administrated

well

5 6. Tax already used based on the

function

6 7. Your compliance affect tax

revenue performance

7 8. Tax investigation minimalize

late tax payment

8

Variable Indicator No of question

Scale

Tax Revenue Performace

9. Information about tax increase tax consciousness

9

Interval 10.Tax allocation have fulfill

society need

10 11.Tax budget allocated well 11 12.Tax revenue already used

based on the function

12 13.Tax revenue already fit with

estimated

13 14.Subsidy helping the society 14 Source: Data are processed

CHAPTER IV

RESULT AND ANALYSIS

A. ResearchObjects

1. Place and Time of Research

In the Dutch colonial period, Tangerang is a region that goes into Batavia (now Jakarta). Regional ethnic maintain three etnics, ie, Sundanese, Betawi, and Tionghoa. Beginning of Tangerang name is Tangeran derived from the Sundanese language means "sign". Because first established a memorial western Cisadane. Monument was established to defend the eastern region Cisadane and keep the soil Parahyang. The monument was established by Prince Soegri, one of the sons of Sultan Ageng Tirtayasa, from Banten sultanate.

As time went on, Tangerang also stand independently and become a modern industrial area. In addition, the growth of the economy as the Tangerang district and regional track adjacent to the capital city Jakarta sped rapidly. Especially after the issuance of Presidential Decree 1976 on the development Nomor.13 Jabodetabek (Jakarta, Bogor, Tangerang, Bekasi), which became Tangerang regency buffer area of Jakarta Capital Special Region.

In 1993, issue of Law Number.2 on the establishment of the city of Tangerang. Under this law established the city of Tangerang Tangerang

became autonomous region, which isseparated from Tangerang Regency. Relating it by Government Regulation Number.14 Year 1995 on the transfer of the Capital District of Tangerang Municipality of Region II Regional Level toTigaraksaTangerang District.

In 2000 some community leaders from Chester district, Serpong, Pamulang, Pondok Aren and assembled to forma newtown, called Cisapera (Chester, Cisauk, Pamulang, Serpong and Pondok Aren). This is done to separate from Tangerang regency. The plan comes as residents in the southern district of Tangerang feel less attention, both from the central government so far, and many facilities are neglected. Hence, people wishes to set up autonomous regions, the central government is not so much and cared for by the government.

South Tangerang is a city in Provins Banten, Indonesia. The city was inaugurated by the Minister of Home Affairs of Indonesia, Merdiyanto, on 29 October 2008. The city is adivision of Kabipaten Tangerang. On December 27, 2006, the House of Representatives approved the formation of Tangerang Regency South Tangerang City.

Tangerang Regency boundary with South Tangerang City, which is bounded by the river Cisadane. Similarly, the center of the new government is formed. Takinga decision on any districts that are also set in South Tangerang. House of Representatives of South Tangerang Regency too close to call each faction held before the plenary meeting called. There

Reliability Test

Taxpayers Conscoiusness

Case Processing Summary

N %

Cases

Valid 50 100.0

Excludeda 0 .0

Total 50 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics Cronbach's

Alpha

N of Items

.808 9

Item-Total Statistics Scale Mean if

Item Deleted

Scale Variance if Item Deleted

Corrected Item-Total Correlation

Cronbach's Alpha if Item

Deleted

KWP1 31.06 12.180 .389 .806

KWP2 30.90 13.847 .261 .812

KWP3 30.94 13.119 .346 .806

KWP4 31.52 11.112 .621 .772

KWP5 31.22 11.808 .518 .787

KWP6 31.24 12.227 .500 .789

KWP7 31.42 10.902 .725 .757

KWP8 31.42 10.861 .670 .764

Tax Services

Case Processing Summary

N %

Cases

Valid 50 100.0

Excludeda 0 .0

Total 50 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics Cronbach's

Alpha

N of Items

.921 15

Item-Total Statistics Scale Mean if

Item Deleted

Scale Variance if Item Deleted

Corrected Item-Total Correlation

Cronbach's Alpha if Item

Deleted

PP1 47.08 63.830 .410 .922

PP2 47.38 59.710 .659 .915

PP3 47.52 61.316 .504 .921

PP4 47.26 59.135 .688 .915

PP5 47.28 59.430 .744 .913

PP6 47.30 60.500 .600 .917

PP7 47.12 59.251 .727 .913

PP8 47.22 59.971 .638 .916

PP9 47.34 59.576 .686 .915

PP10 47.36 60.439 .616 .917

PP11 47.24 60.798 .615 .917

PP12 47.40 60.408 .584 .918

Taxpayers Compliance

Case Processing Summary

N %

Cases

Valid 50 100.0

Excludeda 0 .0

Total 50 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics Cronbach's

Alpha

N of Items

.890 12

Item-Total Statistics Scale Mean if

Item Deleted

Scale Variance if Item Deleted

Corrected Item-Total Correlation

Cronbach's Alpha if Item

Deleted

KP1 42.66 37.739 .202 .898

KP2 42.58 36.738 .375 .891

KP3 42.44 35.068 .549 .883

KP4 42.24 32.758 .683 .876

KP5 42.48 33.030 .675 .876

KP6 42.36 32.113 .666 .877

KP7 42.42 32.249 .648 .878

KP8 42.22 33.440 .701 .876

KP9 42.48 34.010 .582 .882

KP10 42.46 30.539 .736 .872

KP11 42.38 32.893 .636 .879

Tax Revenue Performance

Case Processing Summary

N %

Cases

Valid 50 100.0

Excludeda 0 .0

Total 50 100.0

a. Listwise deletion based on all variables in the procedure.

Reliability Statistics Cronbach's

Alpha

N of Items

.921 14

Item-Total Statistics Scale Mean if

Item Deleted

Scale Variance if Item Deleted

Corrected Item-Total Correlation

Cronbach's Alpha if Item

Deleted

KPP1 39.36 59.949 .667 .915

KPP2 39.44 62.047 .563 .918

KPP3 39.32 61.732 .599 .917

KPP4 39.32 61.487 .663 .915

KPP5 39.16 62.586 .651 .916

KPP6 39.10 59.765 .752 .912

KPP7 38.90 62.337 .503 .921

KPP8 38.72 63.104 .562 .918

KPP9 38.62 62.608 .538 .919

KPP10 39.30 58.459 .779 .910

KPP11 39.26 60.931 .712 .913

KPP12 39.26 60.809 .597 .917

KPP13 39.16 60.831 .752 .912

Appendix 4: Result Of Multiple Regressionn Linear

Coefficientsa Model Unstandardized Coefficients Standardized

Coefficients

t Sig. Collinearity Statistics

B Std. Error Beta Tolerance VIF

1

(Constant) -10.572 10.459 -1.011 .317

KWP .603 .270 .290 2.234 .030 .814 1.229

PP .299 .134 .288 2.241 .030 .826 1.210

KP .353 .167 .259 2.120 .039 .918 1.090

Model Summaryb Model R R Square Adjusted R

Square

Std. Error of the Estimate

1 .609a .371 .330 7.044

a. Predictors: (Constant), KP, PP, KWP b. Dependent Variable: KPP

ANOVAa

Model Sum of

Squares

Df Mean Square

F Sig.

1

Regression 1348.537 3 449.512 9.060 .000b Residual 2282.343 46 49.616

Total 3630.880 49 a. Dependent Variable: KPP